Last updated: May 21 2013

Build Private Pensions for the Disabled with an RDSP

Health care and home care is expensive to governments and can leave gaps in services that you may find unacceptable for your loved one.

An alternative is private funding for additional care. The RDSP can help. It is a registered plan set up for a disabled individual. Contributions are not deductible, but generous government assistance is available in the form of Canada Disability Savings Grants and Bonds. It's a good way to ensure dignity in disability.

Withdraw RDSPs with caution. Amounts withdrawn from RDSPs are taxable to the beneficiary as Disability Assistance Payments. If grants and bonds are withdrawn within ten years, some portion may need to be repaid, except in the case of a specified disability savings plan (where the beneficiary has a life expectancy of not more than five years).